U.S. Inflation Rate Falls Below Expectations in September, Boosting Rate Cut Prospects

According to PANews, a key inflation indicator released by the U.S. Department of Commerce on Friday showed that the inflation rate for September was lower than anticipated. The report, delayed due to a government shutdown, signals a potential green light for further interest rate cuts by the Federal Reserve. The core Personal Consumption Expenditures (PCE) price index, excluding volatile food and energy prices, rose by 0.2% month-over-month and 2.8% year-over-year. While the monthly rate met expectations, the annual rate was 0.1 percentage points lower than predicted. Additionally, data from the U.S. Department of Commerce's Bureau of Economic Analysis indicated that overall personal consumption expenditures increased by 0.3% monthly, with an annual inflation rate also at 2.8%, both aligning with forecasts. Federal Reserve officials use the PCE price index as a primary tool for assessing inflation. Although they consider both overall and core data, core data is generally viewed as a better indicator of long-term inflation trends. The report's release was postponed for several weeks due to the government shutdown, during which all data collection and economic reporting were halted.